So an unmentioned issue here with innovation is the big 5 banks and reputational risk policies. If they find out a company is making bombs or selling to the military it likely gets tossed from the bank. Unfortunately the credit unions don't have enough capital and aren't sophisticated enough to deal with start ups which further hampers small business in the defense sector.
Great thread! Echoes many of the thoughts I've had on reforming procurement & ITBs in particular (though I am far from a specialist in ITBs).
There are many canadian defence companies manufacturing a slew of vehicles, Unmanned systems, simulation & trainers, or a host of subsystems. It is unfortunate that many seem to have been bought up by US or other players though, so sometimes it really seems like we don't make much stuff (& now, what we do make often gets slapped as ITAR & US origin...)
I'd love to see SMART procurement that can leverage more Canadian content... Something that is certainly achievable.
We have a lot of great companies, it's just that they're usually niche or part of bigger companies as you said. Rheinmetall, Lockheed and GDLS have big presences and be very involved, but its hard to call them Canadian.
I'm honestly not the biggest expert on ITB, That's something to ask Massie about lol, but I am concerned that we're focusing on the wrong direction if we want to boost the defence industry. Usually it's the same group of companies getting those deals anyways.
At the same time, getting production is hard, which is why I want to see more package deals lol. If I'm spending billions on Subs and munitions in South Korea, I wanna try and lock down as much production as possible.
That may mean aiming for a package that incentivizes them to actually invest, but I don't think we're there yet from a political or bureaucratic standpoint to do that.
Personally, the intent of ITBs is good (better than IRBs)... But they are convoluted, which makes them opaque & difficult to track (or bid). Might just be one reason the AG found more than a few issues with ISED's performance measurement of ITBs.
One reason ITBs are difficult, is that are procurements tend to be one and done. Other than MSP and NSP, we don't really have long term stable spending than enables anything other than short term investment. Because of AOPS & River class, ISI has long term partnerships & investments with tonnes of suppliers. It may require picking some winners, but we should look at a similar procurement programme for land vehicles (& expand the MSP).
Larger MCEs for small fast procurements would also be able to provide meaningful business to many of our small & medium defense contractors, who struggle getting larger contracts & therefore don't seem to attract interest or investment.
Thanks for this detailed thread! I agree with most of it! I would add that UAVs are the new artillery. We need to secure that supply chain with in Canada production also.
Agreed! I think we have a lot of potential for UAV production here, and is one of the high-end technologies I would love to see us focus on developing as a proper industry.
We will have to take a more proactive look at autonomous technologies, and soon. We don't want to risk falling behind because we're slow to commit.
One day I will write about Cellula, if they ever get back to me! Both them and Kraken deserve a lot of love.
So an unmentioned issue here with innovation is the big 5 banks and reputational risk policies. If they find out a company is making bombs or selling to the military it likely gets tossed from the bank. Unfortunately the credit unions don't have enough capital and aren't sophisticated enough to deal with start ups which further hampers small business in the defense sector.
Great writeup!
Great thread! Echoes many of the thoughts I've had on reforming procurement & ITBs in particular (though I am far from a specialist in ITBs).
There are many canadian defence companies manufacturing a slew of vehicles, Unmanned systems, simulation & trainers, or a host of subsystems. It is unfortunate that many seem to have been bought up by US or other players though, so sometimes it really seems like we don't make much stuff (& now, what we do make often gets slapped as ITAR & US origin...)
I'd love to see SMART procurement that can leverage more Canadian content... Something that is certainly achievable.
I knew you would get behind my screwy ideas. 🤣
We have a lot of great companies, it's just that they're usually niche or part of bigger companies as you said. Rheinmetall, Lockheed and GDLS have big presences and be very involved, but its hard to call them Canadian.
I'm honestly not the biggest expert on ITB, That's something to ask Massie about lol, but I am concerned that we're focusing on the wrong direction if we want to boost the defence industry. Usually it's the same group of companies getting those deals anyways.
At the same time, getting production is hard, which is why I want to see more package deals lol. If I'm spending billions on Subs and munitions in South Korea, I wanna try and lock down as much production as possible.
That may mean aiming for a package that incentivizes them to actually invest, but I don't think we're there yet from a political or bureaucratic standpoint to do that.
Personally, the intent of ITBs is good (better than IRBs)... But they are convoluted, which makes them opaque & difficult to track (or bid). Might just be one reason the AG found more than a few issues with ISED's performance measurement of ITBs.
One reason ITBs are difficult, is that are procurements tend to be one and done. Other than MSP and NSP, we don't really have long term stable spending than enables anything other than short term investment. Because of AOPS & River class, ISI has long term partnerships & investments with tonnes of suppliers. It may require picking some winners, but we should look at a similar procurement programme for land vehicles (& expand the MSP).
Larger MCEs for small fast procurements would also be able to provide meaningful business to many of our small & medium defense contractors, who struggle getting larger contracts & therefore don't seem to attract interest or investment.
Thanks for this detailed thread! I agree with most of it! I would add that UAVs are the new artillery. We need to secure that supply chain with in Canada production also.
Agreed! I think we have a lot of potential for UAV production here, and is one of the high-end technologies I would love to see us focus on developing as a proper industry.
We will have to take a more proactive look at autonomous technologies, and soon. We don't want to risk falling behind because we're slow to commit.
So true! In the water domain I’m big fans of these two:
https://www.krakenrobotics.com/
https://cellula.com/
The issue is they and other Canadian firms are too small. We need them at scale.